Archive for June, 2012

We’ve been waiting for the Supreme Court’s decision about the Affordable Care Act for weeks. It looks like tomorrow might just be the day that we get a decision, so here is a summary of some of the what-ifs that I found in an Associated Press article. Mark Sherman and Ricardo Alonso-Zaldivar give six possible Supreme Court rulings and what they’ll mean for America in “Possible outcomes in pending health care law case.” First of all, the Supreme Court could uphold the Affordable Care Act and say that it is legal. That would end the legal battle, but Republicans would likely to continue to fight against this health care reform. The article picks the winners in this scenario as the current uninsured Americans.

If the entire law is declared unconstitutional, both Democrats and Republicans will have to continue working to fix the health care system. The ridiculously high costs, waste, and millions of uninsured Americans would still be present. Those with health insurance would have a lot to lose as well because health insurance companies could easily stop covering children until age 26 and offering preventative care without copayments. The next possibility is that the individual mandate could be struck down and the remainder of the Affordable Care Act stay in place. Some people say that health insurance rates could increase anywhere from 10-30% if the individual mandate is struck down, but insurers still are forced to offer coverage to anyone applying.

The courts could get rid of the individual mandate as well as the requirements of health insurance companies to cover anyone and limit their charges for older people. While this would save the insurance industry from a financial catastrophe, it would not solve the problem of those with preexisting conditions finding medical coverage. If only the expansion of Medicaid is struck down, half of the people that were meant to be helped with the Affordable Care Act would be in trouble. Finally, the Supreme Court could say that it is too soon to determine whether the law is constitutional or not. This would likely make room for even more political debate and is not something that the Supreme Court wants to happen. Let’s hope we get a decision soon.

If you live in Texas and you have health insurance, you could be one of the many Texans getting a rebate from your health insurance company. According to Houston’s Chronicle, David Hendricks writes that “Health insurance rebates (are) coming for Texans.” Even though the Affordable Care Act health reform is currently under review by the Supreme Court, plans are moving forward as though the reform will remain unchanged. There was a June 1 deadline for all health insurance companies to report how much of their premiums went towards health care and how much went towards administrative costs. Any insurance company who spent more than 20% on administrative costs, including pay for executives and profits, has to refund that excess to its policyholders.

There will be $167 million in rebates for 1.5 million Texas residents; this is highest amount in the U.S. accounting for 15% of the total rebates. Those with individual health insurance policies will receive rebates as refund checks, reductions in premiums for the future, or credit card reimbursements. For those Texans who have group health insurance through a small business or large employer, the refund process will be different. The companies will actually receive the health insurance refund and will use that money to improve health insurance as a whole for the company. One example will be an overall improvement in the health care coverage. The U.S. Department of Health & Human Services released a report with the overall information last week, but there is no listed detail about which health insurance companies will have to pay up rebates and which maintained administrative costs below the 20%.

When the federal government stipulated that Americans had to have no health insurance for six months before they would qualify for the government’s high-risk health insurance plan, they weren’t hoping for people to drop any health insurance and go without for six months. That has been an unintended consequence though. According to Kaiser Health News’ “Taking A Risk To Secure Health Insurance,” freelance writer Randy Dotinga dropped his California high-risk health insurance in January to go without coverage for six months and qualify for the federal high-risk plan. The reason is that there is a huge cost and benefits difference when you compare California’s high-risk health insurance and the federal program.

Unfortunately, the author only qualifies for high-risk plans because of his pre-existing condition, atrial fibrillation in his heart diagnosed at age 27. He has a very low risk for complications, but could not find an individual health insurance company to insure him with his pre-existing condition label. As a resident of San Diego, he opted for California’s high-risk health insurance plan. He pays $9,000 a year for his PPO coverage, but its limits are extremely low. With only $75,000 for annual spending and $750,000 of lifetime coverage, Dotinga would be in deep medical debt if he were to face a medical crisis. The federal plan he is hoping to qualify for would only cost him $3,180 per year and would offer unlimited yearly and lifetime coverage, quite an upgrade. Now you see why he is willing to risk going six months without health insurance.

Even if the government were to eliminate its six month requirement, they would have to find another way to keep it so that the numbers of Americans joining their plan was not out of control. The need for health insurance coverage is high right now and many Americans are looking forward to a certain provision in the Health Care Reform Act that takes full effect in 2014. Health insurance companies will no longer be able to deny coverage to Americans with pre-existing conditions. This is good news for the author and others suffering from conditions like diabetes and asthma, but this good news might not come to fruition. There is a good chance that President Obama’s health care reform will be overturned, leaving Dotinga with no option other than his low coverage, $9,000 a year California high-risk health insurance plan.

Look out, Americans. According to a Kaiser Health News report, “Health Care Costs (are) Expected To Increase 7.5% In 2013.” I don’t think anyone is prepared for that, but 7.5% is actually considered good compared to past increases. The rates of inflation and economic growth are three times less than that, not to mention many Americans are out of work or not getting raises at their current jobs. The best way to protect yourself against rising health insurance rates is to compare health insurance companies and find yourself the best rates you can get.

Reuters says that while the cost of your health care services will likely increase by 7.5%, the largest employer-sponsored health plans will see an increase closer to 5.5%. Company wellness programs and workers paying more towards insurance will keep those plan costs increasing less. It is becoming increasingly popular for more health insurance costs to be paid by workers, even with employer-sponsored plans.

Bloomberg points out that the 7.5% increase actually makes it the fourth year in a row that increases are under 8%. I guess that is a good thing. They point out that the rate is slowing, which is in part due to cheaper health clinics, less expensive drugs and supplies, and the effect of hospitals publishing their costs to keep health insurance rates down. If you take changes in benefits into account, the overall rate is actually increasing more like 5.5%. This is because deductibles and co-payments are higher, so Americans are still paying more out of their own pockets.